Australian miners need to take a bigger role in helping indigenous businesses grow if they want sustainable suppliers and contractors, Fortescue Metals Group Ltd. CFO Ian Wells said, as Aboriginal procurement experts say broken promises have harmed the sector's reputation.
Wells told an Aug. 1 West Australian Mining Club function panel in Perth, Australia, that miners need to engage with indigenous business leaders to increase their companies' cultural awareness and to better understand the local issues that aboriginal people face, whether it be social, economic, heritage or spiritual.
This cultural awareness extends to understanding the spiritual importance of the land being exploited, and treating it and the communities there with respect. It is only through doing so, in addition to providing employment opportunities, that companies can boost their social acceptance among aboriginal communities.
Fortescue Metals Group CFO Ian Wells addresses the West
Source: WA Mining Club.
He said reaching out to indigenous businesses to discuss how they can better participate in the mining sector's procurement process for projects is also critical as some are unfamiliar with the tendering process. Wells said a "top-down" approach is essential for mining companies.
Allan James, CEO of Carey Group, Australia's largest 100% indigenous owned and operated civil and mining business, told the panel that while the mining sector in which he has worked for the past 20 years has generated much good will, the industry could not afford to get complacent.
James, who managed social responsibility and sustainable development for Newmont Goldcorp Corp. and BHP Billiton Nickel West Pty Ltd., said there was still a "healthy degree" of skepticism when it comes to engagement by the mining sector, such as around mining towns in Wiluna and Leonora where he heads local indigenous groups.
"Culture and heritage are finite resources," he said. "If you're going to mine on [Aboriginal] country, the bare minimum is that you provide employment opportunities to improve social conditions."
Kyra Bonney-Galante, Indigenous Strategy General Manager at human resources firm Chandler Macleod, told the panel that in her experience, companies say they require the use of indigenous businesses in their tenders, but "when it comes to winning contracts, they don't engage with those indigenous businesses."
This breaks down relationships with Aboriginal people and their businesses. "This has been going on for so long, giving false hope, because those contracts also give flow-on social benefits to indigenous communities," said Bonney-Galante.
"There's an old mentality that as soon as you put the word 'indigenous' in front we're not capable, whether it's employment or business. We are capable. You just need to give us the opportunity to prove it," she said of Aboriginal people and businesses.
This creates a negative "brand" for miners and the larger contractors in Aboriginal communities due to the tight-knit, connected nature of those communities, where word spreads fast.
"If you do the wrong thing in recruitment they will tell their families and communities and you will struggle to employ people on your projects," Bonney-Galante said.
Maintaining good relationships and sticking to indigenous employment goals will ensure families talk about companies in a positive light, and pass that on to their children who will want to work for the company in the future, she said.
In its efforts to engage with the aboriginal community, Fortescue's Wells said the company has 8,500 people focused on ensuring all employees and contractors, including Aboriginal businesses, are "set up for success."
The iron ore producer's "Billion Opportunities" program has awarded 270 contracts and sub-contracts valued at A$2 billion to 110 Aboriginal-owned businesses and joint ventures since it was started in 2011, including A$230 million in fiscal 2018 alone.
He said constant consultation with indigenous business leaders is necessary as "each of them need different things, and each contractor and Aboriginal business is different.